Max W. Berger
Securities Fraud · Shareholder Rights · Institutional Investors · Corporate Governance
Max W. Berger: From the Financial Statement to the Final Distribution
Max W. Berger’s work for institutional investors traces a securities case across its full life: the client’s choice of counsel, the proof against corporate gatekeepers, the terms of settlement, and the years required to put recovery into investors’ hands.
Accounting Before Advocacy
Max W. Berger graduated from Baruch College in 1968 with a degree in accounting. Three years later, he received his J.D. from Columbia Law School, where he edited the Columbia Survey of Human Rights Law. His later securities cases repeatedly concerned the people behind reported numbers: who prepared them, who audited them, who repeated them to investors, and what each person did when a statement no longer matched the company beneath it.
Berger helped found Bernstein Litowitz Berger & Grossmann in 1983, when the firm had four lawyers. He remains a partner in its New York and Los Angeles offices. His practice has centered on securities-fraud cases, shareholder rights, class litigation, and corporate governance. In his cases, those fields involve public pension funds selecting counsel, underwriters defending pre-offering diligence, directors contributing personal funds, and settlement terms governing board review of future acquisitions.
In Cendant, WorldCom, and the Bank of America–Merrill Lynch litigation, Berger represented institutional investors through lead-plaintiff selection, claims against auditors, underwriters, officers, and directors, settlement allocation, governance terms, and distribution.
Institutional Investors and Lead Counsel
In the Cendant litigation, CalPERS, the New York State Common Retirement Fund, and New York City retirement funds served as the lead-plaintiff group and selected Bernstein Litowitz Berger & Grossmann and co-counsel to represent the class. Berger appeared as lead counsel.
The Third Circuit confirmed that the investor appointed to lead a securities class begins the choice of counsel, subject to judicial review. In later proceedings, the district court credited Berger’s declaration describing the work performed and approved the revised fee.
The Cendant Recovery
Cendant’s settlement combined $2.8515 billion from the company, $335 million from Ernst & Young, a contingent share of specified litigation proceeds, and corporate-governance reforms. Lead counsel investigated the financial statements and audit record, retained experts, conducted discovery, and worked with financial advisers on the defendants’ ability to fund the resolution.
The governance terms required a majority-independent board, independent audit, nominating, and compensation committees, annual director elections, and limits on option repricing. Distributions continued over many years, and BLB&G reported that the Cendant funds were fully disbursed by June 2022.
WorldCom and the Gatekeepers
WorldCom extended the litigation to the banks and other gatekeepers behind major bond offerings. The New York State Common Retirement Fund served as lead plaintiff, BLB&G acted as co-lead counsel, Berger served as a case leader, and Sean Coffey led the trial presentation.
Settlements with underwriters, directors, Arthur Andersen, and company executives totaled more than $6.1 billion plus interest. Directors and their insurers contributed $60.75 million, including $24.75 million from the directors personally. A contingent clause later produced another $38 million for investors.
Bank of America–Merrill Lynch
Investors alleged that material Merrill Lynch losses and bonus arrangements were not disclosed before shareholders voted on the merger. Berger was among the case leaders representing the investor class.
A 2013 settlement created a $2.425 billion fund and imposed governance procedures concerning director elections, compensation oversight, acquisition due diligence, executive review of proxy statements, and shareholder say-on-pay votes. The Second Circuit affirmed approval of the settlement, fees, expenses, and notice. Distributions continued through September 2021.
The Work After Approval
Berger’s representative matters span client selection of counsel, investigation of corporate gatekeepers, settlement negotiation, governance reform, allocation, and distribution. He worked with institutional lead plaintiffs, co-lead counsel, trial and appellate lawyers, experts, and claims administrators across each stage.
Settlement approval began years of administration. Plans had to distinguish among securities and purchase dates, contingent payments had to mature, and repeated distributions placed recoveries into investors’ hands long after the first approval hearing.